Oregon Gov. Tina Kotek’s bill for a statewide homeless shelter system is in jeopardy.
House Bill 3644 asks for more than $217 million in general fund money and lays the policy framework to run a statewide shelter program. The bill aims to continue funding the programs that state leaders have supported through a number of initiatives in recent years, including Kotek’s 2023 homelessness emergency order.
What precisely the Legislature plans to do remains unclear. The bill is sitting before the Joint Committee on Ways and Means, which determines state budget policy.
But there’s growing concern among housing advocates that the most recent revenue forecast could imperil the bill and potentially shrink state funding for shelters.
“Allowing our progress to stall or shifting away from an approach that is working would not make sense and worsen the crisis,” Roxy Mayer, Kotek’s press secretary, said in a statement Thursday, following the publication of this story. “If the Legislature does not adequately fund the statewide shelter system, many operating shelters will close. People who previously had a safe place to sleep will sleep outside. We need the state to be moving forwards, not backwards.”
Rep. Pam Marsh, D-Ashland, the bill’s chief sponsor, is rallying support from local government leaders and shelter providers, sending an email Tuesday with the subject line: “Request for your advocacy — URGENT!”
“To heighten my concern, I’ve heard from the Ways and Means co-chairs that they are uncertain that shelter is a state responsibility,” Marsh said in the email, which a recipient shared with OPB Tuesday.
Before the COVID-19 pandemic and the ensuing surge in homelessness, Marsh told OPB, the state “was doing virtually nothing” to fund shelters. Federal stimulus funds helped communities establish shelter space, but much of that money has since dried up.
Marsh said the bill would help continue funding the shelter program, but not expand it. She added, “I think it is frustrating to the co-chairs that this is essentially a new realm of work for the state now, in a budget that hasn’t particularly expanded and this year is contracting.”
The bill would lay out what kinds of facilities should be eligible for state funding, how that money would be disbursed to communities and what data organizations would be required to report back to the state.
“I hope we get as much as we can,” said Marsh, chair of the House Committee on Housing and Homelessness. “Because when shelter dollars go away, that means shelter beds go away because the local governments don’t have that capacity to fill in the gaps from the state’s absence.”
Funding headwinds
Oregon lawmakers learned last month they could expect around $500 million less in revenue in the next budget than formerly predicted. State economists partly attributed that change to fallout from President Donald Trump’s recent spate of tariffs. Cuts in federal Medicaid and food assistance funding could further complicate the picture.
At the same time, the budget-writing committee is weighing several competing — and expensive — proposals in addition to housing, including requests from Kotek to fund the state’s education and behavioral health systems with hundreds of millions of dollars.
“Solving Oregon’s homelessness crisis and expanding access to affordable housing is a priority for the Legislature,” Sen. Kate Lieber, D-Portland, co-chair of the Legislature’s Joint Ways and Means Committee, said in a statement Wednesday. “The reality is that tariffs and chaos from the federal administration are harming Oregon’s economy.”
Lieber added, “We are evaluating all requests knowing that we have limited resources and critical needs across the state.”
In recent years, Oregon lawmakers have passed a number of bills that dedicated vast sums of money toward the housing crisis, much of it at Kotek’s request. Those funds helped spur programs like Project Turnkey, which acquires motels and hotels and converts them into affordable housing or emergency shelters.
Now the governor has proposed $800 million for housing and homelessness in her 2025-27 budget. She has urged policymakers to follow her lead, saying the state is making progress by preventing homelessness and boosting housing production.
Oregon’s housing crisis
It’s not just funding for shelter services that advocates are worried about with one month to go this session. The governor has also proposed $173.2 million in her 2025-27 budget toward disrupting homelessness by funding eviction prevention programs, including through legal services and rental assistance.
Kemp Shuey, executive director of Community Action, an anti-poverty organization in Washington County, said the funds have helped many people remain housed.
“If that doesn’t get fully funded, it’s hard to imagine that these are programs that will sustain,” Shuey said of Kotek’s rent stabilization proposal. “Without that state investment, there is no other viable source for that service, unless the state is able to step in and support it.”
By many accounts, Oregon’s housing crisis remains dire. A record 27,290 eviction cases were filed in courthouses statewide last year. Oregon’s overall homeless population increased 13.6% compared to the year before, according to the U.S. Department of Housing and Urban Development.
Housing and rental costs have outpaced wages, and one in four households spend more than half their income on rent.
Meanwhile, housing production remains stagnant: In 2024, the number of housing permits issued statewide dropped to the lowest level in 14 years, according to a federal database.
Housing debate heats up
Republicans have said throughout the session Oregon is not making enough progress to stop the housing crisis, and that the state needs to change course.
Sen. Dick Anderson, R-Lincoln City, is calling for the state to get out of its own way by loosening regulations to speed up production.
“Certainly, in housing, we haven’t made headway,” said Anderson, the vice chair of the Senate Committee on Housing and Development. “We’re producing less housing than we did. How can that be successful?”
However, lobbyists say local governments are ill-prepared to foot the bill due to budget gaps of their own. “There’s not necessarily more funds to fill those voids,” said Alexandra Ring, a housing and land use lobbyist for the League of Oregon Cities.
Housing advocates say the funds in recent years have helped stave off Oregon housing problems, but haven’t solved them. Now, they say significant cuts to those programs could undermine shelter and housing services at a critical moment, propelling thousands of Oregonians into homelessness and increasing the strain on the social safety net.
“This is entirely in the hands of the majority party leadership in the House and Senate,” said Jimmy Jones, the executive director of the Mid-Willamette Valley Community Action Agency, a nonprofit social services provider in Salem that serves Marion and Polk counties.
“They’ve been warned about what’s going to happen if these policy option packages are not funded, and how grave the consequences are going to be for rural Oregon in particular.”
Jones says local governments already operate on tight budgets and don’t have the voter-approved tax funds that buoy shelter services in the three counties in the Portland metro area: Multnomah, Clackamas and Washington.
“Frankly, there are more homeless folks outside of the tri-counties than there are in them,” said Jones. “So without that investment, there’s no local support at all financially to be able to continue those operations.”
This story comes to you from the Northwest News Network, a collaboration between public media organizations in Oregon and Washington.